Should the Limit of Liability Cover Indemnities?
This week’s musings on tech contracts… Contracting parties often debate whether the limit of liability should apply to indemnity obligations. IT contracts probably answer “no” more often than “yes.” But you can support either answer with good arguments. The Argument AGAINST Limiting Indemnity Liability The indemnity is unusual. It seems to address liability, but it […]
Don’t blindly accept unlimited liability for breach of nondisclosure terms
This week’s musings on tech contracts … In software contracts, the limit of liability (LoL) almost always comes with exceptions. One of the most common has to do with confidentiality. Liability for breach of the nondisclosure clause has no limit. Why? Most LoLs exclude nondisclosure breaches from the LoL … because that’s what we did […]
Your limit of liability might not work on your indemnity
The parties to IT contracts generally agree that the limit of liability (LoL) won’t apply to indemnities. After all, if one party takes responsibility for a third party lawsuit against the other (a third party indemnity) why would that responsibility suddenly end? If the vendor indemnifies against IP claims, for instance, why would it stop […]
Should the Limit of Liability Cover Indemnities?
This article has been superseded by a more recent version. Please check it out. Contracting parties often debate whether the limit of liability should apply to indemnity obligations. IT contracts probably answer “no” more often than “yes.” But you can support either answer with good arguments. The Argument Against Limiting Indemnity Liability The indemnity is […]
New Clause Library!
We’re excited to announce that we’ve posted a complete new library of clauses here at TechContracts.com. ABA Publishing is about to release the 3rd edition of my book, The Tech Contracts Handbook, and the new clauses match those in the new edition. (The prior clause library matched the 2nd edition.) The new clauses included terms […]
Limits of Liability Don’t Work for Indemnities
This post has been superseded by a more recent (and more nuanced) article. See, “Your limit of liability might not work on your indemnity.” Contracting parties often debate whether the limit of liability should apply to indemnities. But few notice the problem. Even if the contract specifically says the limit applies to an indemnity … […]
Open Source in Software Procurement – 3. Warranties
By David W. Tollen This is the third in a series of five posts on Open Source in Software Procurement. Click here for the prior post, and click here for the intro, which lists all five topics. Fear of open source software leads licensees to draft terms like this: “Vendor warrants that the Licensed Software does […]